XML 12 R17.htm IDEA: XBRL DOCUMENT v2.4.0.8
Income Taxes
9 Months Ended
Sep. 30, 2013
Income Tax Disclosure [Abstract]  
Income Taxes
Income Taxes

The Company’s effective income tax rate, including discrete items, was 29.6% and 39.4% for the nine months ended September 30, 2013 and 2012, respectively. The effective income tax rate is based upon estimated income for the year, the estimated composition of the income in different jurisdictions and discrete adjustments, if any, in the applicable quarterly periods, including retroactive changes in tax legislation, settlements of tax audits or assessments, the resolution or identification of tax position uncertainties, and acquisitions of other companies.

During the third quarter of 2013, the Company completed an analysis of its domestic production activities deduction, which resulted in a net tax benefit of $16.5 million for the period from January 1, 2010 through September 30, 2013. The Company also recorded a discrete item during the nine months ended September 30, 2013 related to the reinstatement of the federal research and development credit at the beginning of 2013, which was retroactive to 2012.

For the nine months ended September 30, 2013, the effective income tax rate was lower than the federal statutory tax rate mainly due to the domestic production activities deduction, the composition of income in foreign jurisdictions that is taxed at lower rates compared to the statutory tax rates in the United States, as well as the reinstatement of the federal research and development credit during 2013.  For the nine months ended September 30, 2012, the effective income tax rate was higher than the federal statutory tax rate mainly due to the effects of accounting for stock-based compensation in accordance with the authoritative guidance for share-based payments and state income tax expense.

During 2012, the Company corrected immaterial errors in its reported income tax expense attributable to prior fiscal periods. During the nine months ended September 30, 2013, the Company concluded the review that gave rise to the corrections and recorded an additional $1.4 million of income tax expense.